March canola is up $7.10 per metric ton (mt), March soybean oil is up 1.88 cents/pound, May European rapeseed is up 2.25 euro per mt and February Malaysian palm oil is up 1.44%. March oats are up 7 1/4 cents/bushel. February crude oil is down $2.96 per barrel, February ULSD is down $.0733 per gallon, and the March Canadian dollar is down .00120 at .72145. The March U.S. Dollar Index is up .238 at 99.145 and the February Brazilian real is up .00120 at 0.18585.

Soybean oil is sharply higher in early trade on reports biofuel blending mandates will be finalized by early March. Reports also suggest the total blending target may be close to the June proposal calling for 5.6 billion gallons to be blended with a 5.2 billion to 5.6 billion gallon range being suggested (in current reports). For comparison, 2025 was set at 3.35 billion with 2024's mandate being 3.04 billion. Given the pessimism since last summer over the lack of progress, the market has reacted very positively to the rumors, especially considering the relatively low soybean oil content of the 2025 crop and exports being strong enough for the USDA to raise the annual estimate on Monday (from 900 million pounds to 1.2 billion pounds).

Canola rallied sharply when the reports initially broke, adding to previous gains on optimism over progress on tariff talks in China. Sine then, prices have drifted back somewhat but remain higher on the day. The morning retreat came right from the 100-day moving average so that may still be inspiring some level of de-risking.

Soybeans are higher on the developments while corn and wheat have turned mixed as midday nears. Even exceptional flash export sales announced Thursday morning were unable to offset the weight of sharply lower energy markets (in corn's case). Between all the announcements, 674,000 mt of soybeans were sold to China and unknown (for 2025-26) with 760,302 mt of corn sold to Japan and unknown. That was on top of reasonable weekly export sales totals released earlier that included soybean sales topping estimates with 2.062 mmt sold on the week ended Jan. 8.

In outside markets, Treasuries are still mixed while equities flirt with record highs again. Energy markets remain sharply lower on indications the U.S. will not follow through on previous threats to attack Iran, choosing to increase sanctions instead. The U.S. dollar has firmed further on the developments, trading at values not seen since Dec. 10 after taking out last week's high.

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